SAVE-E Energy Savings: Closing the Energy Efficiency Gap

Danish energy policy includes ambitious targets for energy savings that are important for reducing CO2-emissions and the dependency of fossil fuels. Large saving potentials exist, however, there is great uncertainty related to the specific implementation of savings and limited knowledge of behavioural, structural, and economic obstacles leading to a slow implementation. The project develops methods and models prioritizing energy saving initiatives and quantifies economic consequences including economic activity, employment and public finances. The basis for the analyses is technical and economic saving potentials distinguishing households and production sectors having quite different barriers for the implementation of savings. Describing the investment decision we include behavioural - and investment theory, uncertainty and property rights. For production sectors quantifying and reducing uncertainty w.r.t. the profitability of investments is quite important. For households numerous additional barriers are present. The investment decision by households is analysed combining register- and survey-data and applying micro-econometrics. Finally, optimal policy instruments are designed and prioritized e.g. taxes, quotas and subsidies and based on economic and environmental efficiencies energy saving investments is balanced against investments in renewable energy supply.